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Participation and Decision Making: A Three-person Power-to-take Experiment

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Author Info
Max Albert () (Justus Liebig University Giessen, Dept of Economics)
Vanessa Mertins () (Saarland University, Dept of Economics)

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Abstract

It is often conjectured that participatory decision making may increase acceptance even of unfavorable decisions. The present paper tests this conjecture in a three-person power-to-take game. Two takers decide which fraction of the responder's endowment to transfer to themselves; the responder decides which part of the endowment to destroy. Thus, the responder can punish greedy takers, but only at a cost to herself. We modify the game by letting the responder participate in takers' transfer decision and consider the effect of participation on the destruction rate. We nd that participation matters. Responders destroy more if they (1) had no opportunity to participate in the decision making process and (2) are confronted with highly unfavorable outcomes. This participation e ect is highly signi cant for those responders (the majority) who show negative reciprocity (i.e., destroy more when takers are greedier).

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File URL: http://www.uni-marburg.de/fb02/makro/forschung/magkspapers/05-2008_albert.pdf
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Publisher Info
Paper provided by Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung) in its series MAGKS Papers on Economics with number 200805.

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Length: 44 pages
Date of creation: 2008
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Publication status: Forthcoming in
Handle: RePEc:mar:magkse:200805

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Related research
Keywords: fairness; participatory decision making; power-to-take game; procedural fairness; reciprocity;

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Find related papers by JEL classification:
C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Models of Political Processes: Rent-seeking, Elections, Legislatures, and Voting Behavior

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  7. Reuben, Ernesto & van Winden, Frans, 2008. "Social ties and coordination on negative reciprocity: The role of affect," Journal of Public Economics, Elsevier, vol. 92(1-2), pages 34-53, February. [Downloadable!] (restricted)
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